The Last Word: Federal Student Loans

Today’s the day folks, the day I start building my ark…oh wait, no it’s the day President Barack Obama signs the new student aid initiative into law. But seriously, shouldn’t we start gathering the animals? I don’t know about you, but there’s only so much rain I can take!! I’m writing this on my beautiful campus, in our beautiful library and can’t help but notice that our strategically placed creek is overflowing and has turned into a mini-rapids. Perhaps some ingenious student will take a cafe tray out there later and try to surf the waves…

Anyway, back to health care…er I mean student loans. It’s confusing isn’t it. The Health Care bill that President Obama signed into law last week adds a stipulation for student loan reform that many are not aware of. I touched on it last week in my column, but honestly didn’t understand it myself until this week. It’s hard to cut through the biased news “interpretations” that you find scattered across the Web. Sometimes when I sit down at my computer, I feel like I’m in an Amazonian rainforest with a machete to cut through all the nonsense.

So here’s the light in the clearing for you, a clear understanding of what exactly this new initiative will do for you– a college student.

According to this article from Reuters (which seems to be the most “pure” information I can find), the initiative being signed today will cut commercial banks out of the “business” of student loans completely–thereby ending a multibillion dollar revenue stream for these companies. The White House stated that this will ultimately save taxpayers (i.e. you and I as soon as we get full-time jobs!) $68 billion over the next decade and will help cap the loan repayments to 10% of a college graduates’ income.

Opponents of the bill–mainly Republicans and special interest groups supporting the lending giants like Sallie Mae–said that this bill will not help the economy or students as it will cause the companies to fire their employees and will limit the number of options for students. They will still have a role, according to Reuters, in collecting repayments, but their role will be greatly diminished in the grand scheme of things.

What do you think of this? If you are like me, then you’re graduating THIS YEAR, in less than a month actually and this is something you need to think about. If you are still in college, you need to think about how this will affect you in the long run.

My opinion? I think it’s a good thing, from what I can cut through online and in the news. I think repayments should be capped as many students/college graduates will not have the money to pay in school nor will they have tons of money to pay directly after school. I think the real change that needs to be made is in regulating how much Universities can charge in general–I mean I don’t know about you, but I don’t really think that room and board in a double, triple or quad dorm room cost $13,000 per year. College tuition is something that is on the rise, because colleges are treated like businesses these days, but unfortunately without that very expensive piece of paper, you will never be able to earn enough money to pay off your bills and loans. So basically it’s a case of the chicken or the egg–what came first, high paying jobs or even higher tuition costs?

Let me know what you think! I’d love to hear it from you, my fellow college students.

This week’s beauty tip! GET A LOT OF SLEEP! With finals just around the corner, it’s hard to avoid the temptation of pulling an “all-nighter” to enjoy more time with friends on the weekend, but this will cause your whole body to suffer- your skin will sag, your head will hurt and ultimately, you will feel older than you are. Try going to bed and getting up at the same time every day, 7 days a week. I’m trying this because of a book I read–Change your Brain, Change your Body by Daniel Amen. Check out the site and maybe buy the book, it’s helping me, so maybe it can help you too!

As always, remember to have your opinion heard, whether it’s the last word or not!



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